The proportion of under-25s buying their first home in England has fallen sharply since the 1990s, according to new analysis from Skipton Group and Oxford Economics.

The latest Skipton Group Home Affordability Index sets out how the shape of first-time buying has changed over the past three decades, with the average age of a first-time buyer rising from 29 to 34 since the mid-1990s.

The report says this has been driven by a steep decline in purchases by younger buyers. In the mid-1990s, almost one in four first-time buyer purchases were made by the under-25s. Today, that figure stands at about one in 15.

The findings also point to a market in which buying a first home increasingly depends on joint incomes, family support and longer mortgage terms. More than half of recent first-time buyers, 52%, now rely on two or more full-time incomes, up from 40% in the 1990s.

Around a third receive help from family, while 54% of mortgaged first-time buyers are repaying over terms of 30 years or more.

Deposit requirements have also become harder to meet. According to the index, the average first-time buyer now needs to save more than a full year of combined household income for a deposit.

Affordability pressures are not confined to lower earners. The report says only about one in three higher-earning potential first-time buyer households, with incomes above £77,800, can afford the average first-time buyer home in their local area using their own finances.

The research also suggests the changing market is influencing household formation. Over the past decade, the proportion of first-time buyers with children has fallen from around a third to just over a quarter.

A MODEST IMPROVEMENT IN SIGHT

Despite the long-term deterioration, the index points to a modest improvement in buying affordability over the next few years. It forecasts first-time buyer affordability rising from 12.1% in 2025 to 14.4% by the end of 2028, which Skipton said would mean around 125,000 more households being able to buy their first home.

That improvement, however, is limited to the ability to buy. The report says wider living costs are expected to remain high, with around 40% of potential first-time buyers still likely to face unaffordable essential housing costs over the coming years.

It also warns that greater global uncertainty, including pressure on energy prices, inflation and interest rates, could undermine the expected gains.

BETTER HOMES FOR THOSE WHO CAN BUY

For those who do reach the housing ladder, the picture is more positive. The report says first homes are now generally larger, of better quality and more energy efficient than in previous decades.

First-time buyers are more likely to buy houses rather than flats, the average size of first homes has increased slightly, and close to 90% now meet the Decent Homes Standard.

The data also highlights regional differences. In London, recent first-time buyers tend to buy flats with fewer bedrooms and the smallest floor space, but the homes are more energy efficient, newer and of higher quality than those bought by first-time buyers in the North and East of England.

“it’s encouraging to see early signs that affordability may be starting to improve”

Stuart Haire, Skipton Group CEO, said: “This research tracks, in detail, how the opportunity to buy a first home has declined over several decades. It shows how the aspiration of homeownership has been pushed further out of reach for many younger adults, delaying independence and stability.

“With fewer people buying in their twenties, there’s a growing dependence among first-time buyers on two full-time incomes or help from their parents.

“However, it’s encouraging to see early signs that affordability may be starting to improve, and the focus has to be on realising those gains and ensuring more people can realistically share in them.

“This has become all the more important amid the current pressures on energy prices and potential further increases in living costs.

“As a mutual focused on helping more people get onto the housing ladder, Skipton believes it’s important to put clear, long-term evidence into the public debate to inform policy and drive meaningful action.”